This section takes stock of differences in goals and means between the conceptual design of the NAMEA and its practical use at present.
De Haanet al.(1994) firstly applied the NAMEA concept with the main objective
“to present an common framework for monitoring and analysing environmental and economic policies” (p.1). Their NAMEA contains accounts for five categories of environmental pressures: greenhouse effect, ozone layer depletion, acidification, eutrophication (i.e. nutrient overburden) and solid waste. Neither changes in ecosystems, nor the repercussions of environmental deterioration are included in this NAMEA. In the first and subsequent Dutch national environmental policy plans (cf. VROM, 1989, 1993, 1998) these pressures are being confronted with policy targets for predefined years. Obviously, this enhances the policy relevance of the pressure indicators presented in this NAMEA.
The representation of a restricted set of pressure indicators was accomplished by the introduction of so-called ‘environmental theme’ indicators in the NAMEA as developed by Adriaanse (1993). Instead of attributing agents to changes in environmental assets, this NAMEA alternatively allocates agents to the environmental themes. The environmental theme indicators establish a linkage between agents (e.g.pollutants) and the environmental problems to which they are expected to contribute. As such, the environmental themes provide a transparent presentation of a restricted set of aggregated environmental pressure indicators, which help to evaluate the environmental performance of an economy. The presentation at the industry level of traditional national accounts indicators one.g.value added and
employment together with these five environmental pressure indicators received a substantial amount of public attention. This indicator profile shows that the larger part of environmental pressures is concentrated in only a limited number of industries such as agriculture, petroleum and chemical industries which are at the same time industries with relatively small shares in employment and value added.
De Haan & Keuning (1996) extend this NAMEA with accounts for environmental taxes and environmental protection expenditures. This version approximately corresponds to the NAMEA set-up as annually compiled and published by Statistics Netherlands (2000).
In recent years, a lot of experience has been gained with NAMEA type of ‘hybrid’
accounting approaches. The journal “Structural Change and Economic Dynamics”
(1999) issued a special number on the NAMEA including contributions from Japan, Germany, Netherlands and Sweden. In the European Community, the development of the NAMEA has been stimulated by an official communication in December 1994 of the Commission of the European Communities to the European Council and the European Parliament on “Directions for the EU on Environmental Indicators and Green National Accounting”. In this communication, the NAMEA is recommended as an example of how a European System of Integrated Economic and Environmental Indices should be structured. This recommendation is subsequently carried forward by Eurostat, the statistical office of the European Communities, which has resulted in two NAMEA publications (Eurostat, 1999, 2001a), containing the NAMEAs for air emissions of most EU member states. In addition, Hasset al.
(2000) provide a detailed overview and comparison of the NAMEAs for Denmark, Finland, Norway and Sweden. So far, most NAMEA examples are concentrated on the recording of pollution and waste.
The main characteristics of the NAMEA, as being compiled up to date, could be summarised as follows. Firstly, the NAMEA maintains a strict borderline between the economic sphere and the natural environment, established by monetary accounts on the one hand and accounts denominated in the most relevant physical units on the other. The non-monetary accounts show the environmental requirements of an economy, which are not subject to market transactions and which are for that reason not included in the core national accounts. Similarly, the physical flows underlying commodity transactions do not enter the accounts for environmental requirements. From an environmental perspective, the NAMEA table clearly exposes the SNA boundaries and the non-monetary accounts clearly expand these boundaries. The NAM systematically traces down the points of connection of environmental information to the system of national accounts.
Secondly, the NAMEA maintains a clear distinction between physical inputs (extraction of resources) on the one hand and outputs (emission of pollutants) on the other. Hellsten et al.(1999) argue that from a welfare perspective both types of environmental requirements can be explained as an economic use of natural resources: either as a source or as a sink. This principle is also in line with the
SEEA-1993 and the Leontief model (1970) in which pollution is indeed recorded as a primary input similarly to labour and capital.
By following the direction of flows, the substances account in the Dutch NAMEA systematically express the origin and destination of substance flows, from and to the economic system. This approach takes explicitly record of residual flows that re-enter the economic sphere due to recycling waste collection and incineration activities,e.g.solid waste and wastewater. In addition, this recording enables a logical representation of cross-boundary pollution transfers. In total, the substances account in the Dutch NAMEA systematically explains the difference between on the one hand, thenetamount of environmental pressure originating from the domestic economy, and on the other hand, the amount of environmental pressure that potentially threatens all property of residential entities including produced assets, their health status and the national ecological heritage.
Thirdly, most NAMEAs contain environmental themes account in which substances are grouped together and aggregated in accordance to the type of environmental pressure to which they are expected to contribute. In this way, a wide range of substances are represented by only a limited number of aggregated theme indicators on the basis of weighting methods to be further discussed in chapter 6.
Some theme indicators correspond to nationally or locally bounded environmental problems, reflecting in addition to the net pressure resulting from domestic activities, the net pressure exposed to a country’s territory. For environmental problems on a global scale, i.e.greenhouse effect and ozone layer depletion, the indicators only review the domestic contribution to these global problems.
Fourthly, the NAMEA provides an institutional representation of the economy and its relationship with the environment. This implies that economic activities together with their environmental requirements are defined and subsequently recorded according to statistically observable units,i.e.the so-called establishments classified according to the International Standard Industrial Classification (ISIC). As in economic accounting, environmental accounting preferably relies on totally homogeneous units, that is, an activity entirely designated to the output of one single product. Only for these homogeneous units, the environmental requirements entirely refer to one single product output. However, establishments as observed in reality will usually make use of ancillary production, such as own account power generation, or will have secondary output, which may complicate the allocation of environmental requirements to product outputs. Also, it is clear that both ancillary and secondary production may complicate the comparison of eco-performance of industries between countries (cf. Hasset al., 2000). However, before constructing accounts on the basis of homogeneous units, inputs and outputs have to be consistently recorded first at the level of statistically observable units.
Finally, the NAMEA also records the direct environmental requirements of government and household activities. By convention, public consumption equals government production and their environmental requirements are thus recorded in accordance to government production in the production account. In the NAMEA, a
supplementary household production account is required to take record in a similar way of the direct environmental requirements of households at the level of various household activities.